For the past 20 years Michael Cornish has been steadily building up investments for a comfortable retirement.
Michael, who turned 65 six days ago, is a big fan of tax-friendly Isas - as he was of Peps - and has put together a portfolio worth £500,000, most of it outside the clutches of the taxman.
Yet what is striking about Michael's portfolio is its composition. Until recently there were no investment funds, open-ended investment companies (Oeics) or unit trusts, run by insurance giants such as Legal & General, Prudential or Scottish Widows.
Nearly all the funds he held were managed by big investment names such as BlackRock, Jupiter, New Star and JPMorgan, or some of the 'niche' stock market players such as Lloyd George Management and Investec.
'I'm quite a sophisticated investor,' says Michael, who is divorced and runs his own business in Bridgwater, Somerset, providing back-up power supply systems to major companies. 'As a client of financial adviser Hargreaves Lansdown, I see what funds it is recommending, but at the end of the day I select all my holdings.
'And until recently I've never thought insurance companies made good fund managers. They seemed mired in mediocrity. I'd rather put my money with a company focused purely on investment management.'
But it seems things are changing for the better. Slowly but surely some of the big insurance companies are waking up to the need to deliver better investment performance.
And it has meant some funds run by traditionally unglamorous insurance companies are appearing on the radar of discerning investors such as Michael.
He has now added Standard Life UK Equity Income, Standard Life UK Equity Unconstrained and Norwich Union Special Situations to his holdings. 'Some insurers appear determined to make their mark in the investment funds market and I'm happy to back them if they can prove to me that good performance means as much to them as it does to me,' says Michael.
Insurance companies have responded to accusations of mediocrity in four ways. Some, such as Norwich Union, Scottish Widows and Standard Life, have set up dedicated fund management businesses.
Others, such as Axa, Prudential and Friends Provident, have bought investment businesses with proven records in the shape of Framlington, M&G and Foreign & Colonial, though embattled Friends Provident is in the process of selling F&C as a result of an overhaul of its business. Some, such as Legal & General, have concentrated on offering cheap and simple products such as index-tracking funds.
One person who believes that insurers are keen to improve is James Dalby, fund development manager at Norwich Union. Three years ago he was an independent adviser at Bates Investment Services in Leeds. He admits that investment funds run by insurance companies seldom won his approval, including Norwich Union's 41 funds.
But Dalby says Norwich Union has woken up to its inadequacies. 'For too long, insurers have been poor fund managers,' he says. 'They've had bigger fish to fry, such as managing multi-billion pound with-profits funds. Yet the notion of delivering poor performance is now untenable.'
Dalby points to the recent decision by Aviva, Norwich Union's parent company, to beef up its Morley arm as evidence that investment management is an increasingly important piece of the jigsaw. Morley manages Norwich Union's investment funds and will be re-branded Aviva Investors.
Dalby says the greater freedom given to fund managers to generate superior returns is reaping rewards. 'Eighteen months ago, David Lis, head of UK equities at Morley, encouraged fund managers to become conviction investors - to go out and back their best ideas rather than always playing it safe and sound,' he says. 'It was a loosening of the reins.
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